Missouri's 7th District, U.S. House of Representatives




Congressional Issues 2010
My Message to Politicians

Congress should:
  • admit that The Greatest Depression is on its way.
  • adopt a Bankruptcy Budget, such as spendaholics and compulsive debtors are forced by courts to adopt

This is an update of my webpage on America's bankruptcy.

Here are four resources I think every politician and every would-be leader in America should read. Or at least be aware of.

1. Is the United States Bankrupt? (PDF 146k)
by Laurence J. Kotlikoff
The Federal Reserve Bank of St. Louis Review
A journal of national and international economic developments, particularly focusing on their monetary aspects.
JULY/AUGUST 2006 Vol. 88, No. 4
Proceedings of the Thirtieth Annual Economic Policy Conference of the Federal Reserve Bank of St. Louis, pp. 235-250

The author says "no," but the answer is "yes," which is what motivated him to write the article. The government has made legally binding promises to pay trillions of dollars it doesn't have and has no expectations of getting. There is no way the government can pay its financial obligations -- not without completely overthrowing our system and nationalizing homes and businesses. The unfunded liabilities of Social Security and Medicare have Prof. Kotlikoff very worried. He uses the word "terrifying." If he's worried, so am I. I'm doubly worried that the government doesn't seem to be worried.

2. Here is an article written by Clarence Manion, the former Dean of the Law School at Notre Dame, written back in November of 1955.
This article proves that the government has always known that the Social Security system is a fraud. From the beginning. It's just another tax. Nobody's money is safe. It's gone. The money promised by the government for people's retirement doesn't exist, and there's no hope of being able to raise taxes enough to pay what's been promised.
3. "From Here to Eternity," a speech by Richard Fisher, president and CEO of the Federal Reserve Bank of Dallas
In a more recent speech (May 28, 2008), Fisher speaks of "Storms on the Horizon":
This is an update on Kotlikoff's paper, above. I first blogged about Kotlikoff in August of 2007. The government was over its head to the tune of $60 trillion. Then in October of 2007 I ran across the "From Here to Eternity" speech, which updated government red ink to $83.9 trillion. "Storms on the Horizon" pegs it higher, and I'll bet today, four months after that speech, we've topped $100 trillion. Fisher wrote:

How much would every U.S. citizen who is alive today have to pay if we decided to fully address this unfunded liability through lump-sum payments from our own pocketbooks, so that all of us and all future generations could be secure in the knowledge that we and they would receive promised benefits in perpetuity? Again, the math is painful. With a total population of 304 million, from infants to the elderly, the per-person payment to the federal treasury would come to $330,000. This comes to $1.3 million per family of four—over 25 times the average household’s income.

Politicians have promised this amount of benefits to every man, woman, and child in America in order to buy their votes.

This is insane.

4. Stop the Bailout by Llewellyn H. Rockwell, Jr.
Rockwell is founder of the Mises Institute, named after Ludwig von Mises, arguably the greatest free-market economist of the 20th century, whose student Friedrich Hayek won the Nobel Prize for Economics in 1974.

Rockwell points to the great economists who have proven that the government caused the Great Depression. Fed Chairman Ben Bernanke admitted this at Milton Friedman's 90th birthday, although he may arrogantly believe that he can prevent another Depression even though the fed is doing exactly what brought on the first Great Depression. Bernanke may believe that the problems caused by the expansion of the nation's credit before the 1929 meltdown were caused by the failure of the government to further expand by creating oceans of paper.

This is the thinking behind the proposed bailout of Fannie Mae and Freddie Mac.

This kind of mismanagement -- indeed, our entire monetary system -- is unconstitutional and unethical. The Constitution was sold to America by James Madison on the basis of the average American's "love of justice and his knowledge of the true springs of public prosperity [and] the pestilent effects of paper money on the necessary confidence between man and man, on the necessary confidence in the public councils, on the industry and morals of the people" (Federalist #44). The Constitution withdrew this dreadful power to issue paper money.
Inflation is immoral
Politicians who vote to further inflate the money and credit system by bailing out Fannie Mae and Freddie Mac sin against God. There's just no way to mince words on this. They will bring upon this nation the Greatest Depression.

next: Campaign Finance, Corruption and the Oath of Office